Total Articles: 10
Practical Insights: Dealing with Medicare Part B and COBRA Coverage.
Generally, the Socal Security Act provides that individuals may enroll in Medicare Part B (which covers doctors visits and other outpatient services) when they reach age 65. If they fail to do so during a seven-month initial enrollment period surrounding their 65th birthday, they can enroll during an annual "general enrollment" period that occurs each January 1- March 31, with coverage becoming effective the following July1, though they will incur a penalty in the form of permanently higher Part B premiums (10% increase for each year of available coverage that is foregone). However, actively employed individuals who have employer-provided health coverage can postpone signing up for Medicare Part B until after age 65. When they lose the employer-provided coverage or terminate employment, whichever happens first, they are then provided an eight-month "special enrollment period" ("SEP") during which they can sign up for Medicare effective immediately and without penalty.
COBRA Subsidy Unlikely to be Extended Further.
The American Recovery and Reinvestment Act provided a 65% COBRA premium subsidy to eligible individuals
involuntarily terminated between September 1, 2008, and December 31, 2009. Congress later extended the subsidy three
times; most recently for those involuntarily terminated on or before May 31, 2010. (For information regarding the
original COBRA subsidy and the previous extensions, please see our archived E*Bulletins from April 2010, March 2010,
January 2010, March 2009, and February 2009.)
President Signs Another COBRA Subsidy Extension.
President Obama has signed legislation extending the COBRA premium subsidy to assist individuals who have lost their jobs since the previous COBRA subsidy expired March 31, 2010.
COBRA Subsidy Program Extended and DOL Model Notices Updated Again.
On April 15, President Obama signed into law the Continuing Extension Act of 2010 (the "Act"), thereby extending for a third time the program that subsidizes continued health care coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 (and similar state continuation coverage laws) ("COBRA") for involuntarily terminated employees. That program provides that certain employees whose employment is involuntarily terminated can continue health coverage under COBRA by paying only 35% of the ordinary COBRA premiums for up to fifteen months. The insurer, the employer or the health plan pays the remaining 65%, which is recovered from the federal government through a credit against payroll tax liabilities or through direct reimbursement.
Third Extension of COBRA Premium Subsidy Extends Availability Through May 31, 2010.
Extended now for the third time, the availability of the COBRA premium subsidy has been extended through May 31, 2010. Late on April 15, 2010, President Obama signed H.R. 4851, the Continuing Extension Act of 2010. Final passage in the House of Representatives (votes 289-112) and in the Senate (votes 59-38) ensured that several government programs would be extended, including the COBRA premium subsidy.
COBRA Subsidy Eligibility Period Extended to May 31, 2010.
Last night, President Obama signed the Continuing Extension Act of 2010 (Act). The Act once again extends the eligibility period during which an involuntarily terminated individual can qualify for the COBRA subsidy originally created through the American Recovery and Reinvestment Act of 2009 (ARRA). The period during which an individual could qualify for the subsidy was originally set to expire on December 31, 2009, but was extended by the Defense Appropriations Act of 2010 until February 28, 2010, and extended again by the Temporary Extension Act of 2010 until March 31, 2010. The Act further extends the period during which an involuntarily terminated individual could qualify for the COBRA subsidy until May 31, 2010.
COBRA Subsidy Extended Again . . . and Again.
On April 15, 2010, Congress passed, and the President signed, the Continuing Extension Act of 2010. The Continuing
Extension Act of 2010 extends the existing 65% COBRA premium subsidy for employees who are involuntarily
terminated through May 31, 2010. The subsidy was originally provided through December 31, 2009, under the American
Recovery and Reinvestment Act (“ARRA”), and was previously extended through February 28, 2010, and then March 31,
2010, via the 2010 Department of Defense Appropriations Act and the Temporary Extension Act of 2010, respectively.
For information regarding the original COBRA subsidy and the previous extensions, please see our archived E*Bulletins
from March 2010, January 2010, March 2009, and February 2009.
Another Short-Term COBRA Subsidy Extension (now through May 31, 2010)
As anticipated, President Obama signed H.R. 4851 into law late in the evening on Thursday, April 15, 2010. Among other things, the law extends the COBRA subsidy to individuals losing coverage due to an involuntary loss of employment occurring from April 1, 2010, through May 31, 2010. As originally enacted, the subsidy could extend for as long as 9 months. Through previous extensions, however, the maximum period of subsidy was extended to 15 months. Also through previous extensions, subsidy eligibility was expanded to include individuals who lose coverage due to a reduction in hours, provided they subsequently suffer an involuntary loss of employment on, or after, March 2, 2010. As the ink dries on H.R. 4851, there is pending legislation (H.R. 4213) that would extend the deadline for subsidy eligibility to the end of the year. The Senate has already cleared the measure, and President Obama has publicly endorsed the idea, but the House of Representatives has yet to act on it. For guidance on this and other employment law questions, contact Krukowski & Costello, S.C. at 414-423-1330.
New Stopgap Extension of COBRA Subsidies - Further Extension Pending.
New Stopgap Extension of COBRA Subsidies - Further Extension Pending.
DOL ISSUES UPDATED MODEL NOTICES FOR NEW COBRA SUBSIDY EXTENSION.
Earlier this month we advised that President Obama signed a bill extending the COBRA premium subsidy through March 31, 2010 for covered individuals who experience an involuntary termination. March 4 CM. The new extension bill also expands the subsidy benefit to individuals whose COBRA qualifying event was a reduction in hours between September 1, 2008 through March 31 2010 that caused the loss of their health insurance, followed by termination on or after March 2, 2010 through March 31, 2010.
